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Big Ten, Fox close to huge TV deal

mosito said:
Damn.... That is drastic....

That said, how do we know we will get $250M for the other half.... I assume if it is up for bid that it might be more or less...? And was ESPN not involved in the first bid? Maybe their bid was $175M and that is what they will want to pay for the other half...?

Just curious, not trying to start anything.... It makes sense that it would be similar though. And maybe purposely done by the BIG10 that way.
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Go conservative and figure $150 million for the other half. That is a total of $400 million PLUS all BTN money. BTN pays Big Ten more than $100 million per year contractually, plus profits (which were another $1 million per school as of two years ago; likely to increase significantly).

By the time this deal is in place, you are going to be talking $525 - $575 million in tv revenue per year. That breaks down to $40 million per school. Then you add all bowl (including playoff), BTCG, BTT, and other revenues.
 
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knightfan7 said:
The price is now set. Networks are dying for content. Whether it's NBC, Disney, NFL network, CBS, or a shared partnership, someone will pay.
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I mean even if it is for $150M and Fox gets better rights, It is still at 4x or so what we are getting now.... Can't wait for full membership and we can use some money all around and are miles ahead of Pitt/Cuse in $$$ and everything else...
 
Wolv RU said:
Go conservative and figure $150 million for the other half. That is a total of $400 million PLUS all BTN money. BTN pays Big Ten more than $100 million per year contractually, plus profits (which were another $1 million per school as of two years ago; likely to increase significantly).

By the time this deal is in place, you are going to be talking $525 - $575 million in tv revenue per year. That breaks down to $40 million per school. Then you add all bowl (including playoff), BTCG, BTT, and other revenues.
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You read my mind..... LOL
 
Upstream said:
Yes. This is for 1/2 of the Tier One rights. It works out to about $18 MM per school. So assuming that the other half of the Tier One rights is the same price, that's $36 MM per school. Then BTN revenue is on top of that.
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Wood.
 
Two interesting points...

  1. The conference also is holding back some digital rights that it will offer to digital media companies, sources said.
  2. the term is 6 years, which would mean the B1G is going back to market again right around the time some B12 teams are at the end of their GOR and might want to jump on the gravy train.
 
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krup said:
Two interesting points...

  1. The conference also is holding back some digital rights that it will offer to digital media companies, sources said.
  2. the term is 6 years, which would mean the B1G is going back to market again right around the time some B12 teams are at the end of their GOR and might want to jump on the gravy train.
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They want Texas... And have the money to back it up.....
 
Sounds good. It's going the way I figured it would and was the most likelly scenario a split of T1 between Fox and ESPN. I can't imagine Fox is paying that much of a premium, if at all. If ESPN gets any discount I'd suspect it wouldn't be anything below 200M if Fox is paying 250M and I tend think it'll be closer than that but we'll see. Add the BTN revenue which I believe has passed the profit sharing threshold as well and I think 40-45M seems like a reasonable estimate when bowl/playoff money is added.
 
krup said:
Two interesting points...

  1. The conference also is holding back some digital rights that it will offer to digital media companies, sources said.
  2. the term is 6 years, which would mean the B1G is going back to market again right around the time some B12 teams are at the end of their GOR and might want to jump on the gravy train.
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That's actually a good point and I was wondering about the length. 6 years is actually shorter than I was thinking considering the ACC GOR is not going to expire til the mid 2020s IIRC. B12 was a 13 year GOR and we're a couple years in so that would put the B10 expiration a few years in front of that. Could be a possibility.
 
pmvon said:
Wow, huge deal. BIG and everyone else. SEC is little brother....ha
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To be fair, the SEC will be on a similar level to the B1G, way ahead of the other 3 conferences.

The heavy lifting the B1G did in proving that a conference network was a lucrative model meant that the SEC will most likely end up getting more money from their network than the B1G does from the BTN.
 
Th question I have is for Rutgers take on this. I know we are not scheduled to get a full share for quite a few years but that has to be based on current payouts.

What happens when a restructured deal goes into place. Will we get the additional payouts above and beyond are current payout and then still be slowly moved inito full payout on the rest.

For instance, say RU gets $10mm/yr now while the rest of the schools get $20mm/yr. Over the next 5 yrs we get an additional $2mm until we are fully vested. If the new contract gets executed and all schools will get a payout of $30mm/yr based on projections would RU then get bumped to $20mm and then keep the same vesting period for the additional $10mm? I know these numbers are not legit.

Just curious what anyone knows
 
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RUBlackout said:
Th question I have is for Rutgers take on this. I know we are not scheduled to get a full share for quite a few years but that has to be based on current payouts.

What happens when a restructured deal goes into place. Will we get the additional payouts above and beyond are current payout and then still be slowly moved inito full payout on the rest.

For instance, say RU gets $10mm/yr now while the rest of the schools get $20mm/yr. Over the next 5 yrs we get an additional $2mm until we are fully vested. If the new contract gets executed and all schools will get a payout of $30mm/yr based on projections would RU then get bumped to $20mm and then keep the same vesting period for the additional $10mm? I know these numbers are not legit.

Just curious what anyone knows
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I was thinking the same. Hope that's the case, but would love to see our membership agreement.
 
krup said:
To be fair, the SEC will be on a similar level to the B1G, way ahead of the other 3 conferences.

The heavy lifting the B1G did in proving that a conference network was a lucrative model meant that the SEC will most likely end up getting more money from their network than the B1G does from the BTN.
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But we are free of The Mouse. $EC isn't. It's like having ND in your conference.
 
Upstream said:
Ummm... Fox is only buying 50% of T1 rights. Pretty good chance that ESPN buys the other 50%.
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I really hope that it is NBC Sports. Anyone who is a fan of the English Premier League in soccer knows they have done more than an exceptional job in their coverage and analysis. Their current inventory is limited to things that aren't as popular in America like Indy car racing, moto racing, Tour de France and Formula One racing, so I can see them making a play. Of course mornings in the fall they will have EPL matches to broadcast, but I could see BTN/Fox covering the 12 and 3:30 kickoffs with NBC taking over for the evening kickoffs, especially since FOX has a deal with the PAC12 and they'll want to switch over to PAC12 games later in the day. Plus they have a stable of networks that they regularly broadcast sporting events on that is part of basic cable packages - NBC, NBC Sports, USA, CNBC and Universal.

ESPN usually will move a game or two of interest onto ESPNU or ESPN News which usually requires an upper tier sports package.


The only problem with cutting ties to ESPN is the number of CASUAL eyeballs that are tuned into ESPN. Walk into most sports bars in America, any doctor's office, bus/train/airport waiting area, break rooms/cafeterias in offices, etc and chances are it will be tuned into ESPN. Not to mention, any place that has extended stays - hospitals, nursing homes, hotels all have part of ESPN as part of their TV package rather than FS1 or NBCSN. Also and this is quite random, but ESPN is broadcast all over the world. From Argentina to India to Australia. I've had people come up to me in the most random of locations outside of the US and recognize my block R hat cause they saw it on ESPN. The Worldwide leader in sports still has some pull.

Not to mention, the bias they will spew on the B1G will be at an all time high and College Gameday will basically be a rotation between Tuscaloosa, Gainesville and Baton Rouge.
 
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$250 million per year is a big number for 25 football games, 50 men's basketball games and, presumably, some women's basketball, Olympics sports, etc. Consider that the Pac-12 will be paid in 2019 slightly north of $250 million combined from FOX and ESPN for 45 football games (44 regular season games & the conference championship game) and 68 men's basketball games (65 regular season games & three conference tournament games), per the term sheet entered as evidence as part of the Ed O'Bannon vs. NCAA lawsuit.

* Remember that the Big 12 had some fairly low guarantees in their TV deal with respect to the number of games that a FOX broadcast network and a national cable outlet had to carry on a yearly basis: Six games a year on each platform. So after those 12 games, plus the 23 earmarked for ESPN, both FSN and FS2 could reap the rewards of additional football games. FOX, potentially, has a full year to ramp up carriage of FS2 if this is where they plan to add some of these football games. I'm not as big on F/X taking on any of these games since FOX didn't get everything that ESPN has today.

If more Big 12 games move to FSN, the conference that is hurt is C-USA, who is trying to wrap up rights for next athletic year and had around 13-20 games per year on FSN. Mitch Vingle noted that FOX apparently did not bid for C-USA football,
 
RUBlackout said:
Th question I have is for Rutgers take on this. I know we are not scheduled to get a full share for quite a few years but that has to be based on current payouts.

What happens when a restructured deal goes into place. Will we get the additional payouts above and beyond are current payout and then still be slowly moved inito full payout on the rest.

For instance, say RU gets $10mm/yr now while the rest of the schools get $20mm/yr. Over the next 5 yrs we get an additional $2mm until we are fully vested. If the new contract gets executed and all schools will get a payout of $30mm/yr based on projections would RU then get bumped to $20mm and then keep the same vesting period for the additional $10mm? I know these numbers are not legit.

Just curious what anyone knows
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I don't claim to be a financial whiz nor do know the fine points of the deal when Rutgers and Maryland joined the conference. With that in mind, the way I see it is when both schools joined a figure was assigned to the total value of the conference. Each school would have been required to pay for a buy-in share plus a likely premium. That total amount was then spread over a number of years until paid in full after which time they'd receive a full share. I would think both Rutgers and Maryland would see an increase in revenue as well but they'd still need to pay the previously negotiated annual amount until the buy-in in complete. Of course the situation is a bit different for Maryland since the conference gave them some money to complete their break with the ACC.

On the other hand, if the figures kicked around in the article are overblown the predictions won't matter much.
 
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mosito said:
They want Texas... And have the money to back it up.....
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Yep. F$U too. Look for more expansion within the next 6 years. Any team going B1G will be able to buy their way out of GOR agreement. Expensive yes. But inexpensive long term based on future revenues. Sick amounts of money. NJ pols can skim half, and we'd still be doing great.
 
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I think there is still plenty of competition for the other 50% of T1 rights and may see that go for more than $250mm. Twitter just threw their hat into the ring for Thursday night NFL games. Think Netflix or Amazon wouldn't want a piece of the live sports market action?

In reality cord cutting has little effect on the live event market, if anything it's the one thing consumers will keep the cord thus making it more valuable not less.
 
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jason21psu said:
I think there is still plenty of competition for the other 50% of T1 rights and may see that go for more than $250mm. Twitter just threw their hat into the ring for Thursday night NFL games. Think Netflix or Amazon wouldn't want a piece of the live sports market action?

In reality cord cutting has little effect on the live event market, if anything it's the one thing consumers will keep the cord thus making it more valuable not less.
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Netflix and Amazon are very interesting possibilities! And the new players routinely have to pay extra to break into the market.
 
jason21psu said:
I think there is still plenty of competition for the other 50% of T1 rights and may see that go for more than $250mm. Twitter just threw their hat into the ring for Thursday night NFL games. Think Netflix or Amazon wouldn't want a piece of the live sports market action?

In reality cord cutting has little effect on the live event market, if anything it's the one thing consumers will keep the cord thus making it more valuable not less.
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Agreed. It seems live sports are, for an important segment of the audience, the one thing that prevents cord-cutting. It is the one thing that people seem to demand to see live, making it a valuable property for advertisers.

I would wonder a bit about BTN revenue if they sell more of the best matchups to Fox (and others like ABC/ESPN) they will end up with less desirable and marketable matchups on BTN. BTN might not have one Big Ten conference game for Michigan or Ohio State.

This was 2015's Saturday Primetime schedule for BTN.. no Ohio State

Saturday, Sept. 12 South Alabama at Nebraska
Saturday, Sept. 19 Rutgers at Penn State
Saturday, Sept. 26 Hawaii at Wisconsin
Saturday, Oct. 3 Michigan at Maryland
Saturday, Oct. 10 Michigan State at Rutgers
Saturday, Nov. 14 Minnesota at Iowa
 
I don't know about Amazon but I can't say that Twitter or Netflix would pay too much for the content. Sure the B10 will make some money but I wouldn't look for the astronomical figures we're seeing with the tv rights.

There was never an official release for what twitter paid the NFL but it was rumored to be around 10M in total IIRC but it wasn't exclusive rights. Netflix has recently raised prices again to 10 bucks on its older subscribers who were grandfathered in at 8 bucks. I've read their strategy is trying to focus on creating more original content because of the increasing costs of acquiring outside content. So I'm not sure how interested they may or may not be. They just had their earnings yesterday and their guidance on subscriber growth numbers were weaker than expected, specifically international though. Amazon I don't really know, although they recently started an offering of video streaming outside of Prime, it ends up being more expensive on a monthly basis. If they want to beef that up I suppose it's a possibility.

So sure there will be money to be made in digital/streaming rights but I don't know that it will be all that lucrative when compared to the rest of the package but hey every penny counts right, lol.
 
krup said:
Two interesting points...

  1. The conference also is holding back some digital rights that it will offer to digital media companies, sources said.
  2. the term is 6 years, which would mean the B1G is going back to market again right around the time some B12 teams are at the end of their GOR and might want to jump on the gravy train.
Click to expand...
BTW forgot to ask who do you think the targets would be if it were the B12. I know everyone thinks Texas but I still think that would be hard to accomplish because of its little brothers. I still think the PAC12 would be their most likely landing spot if they ever left the B12. I could see Kansas but not sure who the 2nd would be? OU seems less of a stretch than Texas, but they still have some of the same issues with Ok. State.
 
kjb32812 said:
Not sure how I feel about this. I am able to watch Penn State every single week on some sort of ESPN/ABC/BTN broadcast so hopefully that won't change. Is that how it is for you all currently? Where you can see every RU game?
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Yes, every football game was shown. Fox has the network channel, FS1 and FS2. Between that, the other winner, and the B1G network, I'd expect more, not less local coverage.
 
rutgersguy1 said:
BTW forgot to ask who do you think the targets would be if it were the B12. I know everyone thinks Texas but I still think that would be hard to accomplish because of its little brothers. I still think the PAC12 would be their most likely landing spot if they ever left the B12. I could see Kansas but not sure who the 2nd would be? OU seems less of a stretch than Texas, but they still have some of the same issues with Ok. State.
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I don't know if Texas would be in play because the new numbers bring the B1G into a neighborhood that Texas already resided in because of their LHN deal.

The other "intriguing" thing is that this 6 year term also ends very close to the end of the Pac12's TV deal.
 
I'm very familiar with Fox and FS1, FS2 because I follow NASCAR and their main deal is with FOX and FS1 (formally Speed channel). They do a great job, and I doubt there will be any Big Ten games on FS2 so don't worry. They don't really have a lot of live sports programming now as it is, other than NASCAR, UFC, MotorCross, and Big East basketball. In the fall, there's no NASCAR (goes to NBC), and no basketball until November, and MotorCross is on Sunday nights for the most part. So, with only 6 maximum 7 games a weekend for the B1G, and you already have a FOX, ESPN (possibly 2), ESPN2, and BTN, that leaves 1 or 2 more games, which will go on FS1 and if there's no room for whatever reason for that second game, BTN will take it, they usually have 2-3 games anyway actually. FS2 will basically not be an issue
 
Also, what I'd really love to see is maybe some more Big Ten original programming on FS1, they already don't have a lot of "extra" shows like ESPN has SportsScience, PTI, Outside the Lines, Around the Horn, etc. A weekly Big Ten special would be cool. I know we have BTN but I feel like they don't do enough original content on all the schools, it really just seems like the daily OSU and UM update. And things on the schools, too, in addition to athletics. But there's really a million shows they could do for the athletics programs.
 
krup said:
I don't know if Texas would be in play because the new numbers bring the B1G into a neighborhood that Texas already resided in because of their LHN deal.

The other "intriguing" thing is that this 6 year term also ends very close to the end of the Pac12's TV deal.
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I didn't realize that. Now that would be something. If they were to reach out that far then you'd have a coast to coast conference. Seems like a stretch literally and figuratively, just the logistics of going beyond Nebraska seems tough.
 
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